NEW YORK (CNNMoney.com) -- The Dow Jones industrials broke through 12,000 for the first time Wednesday, but the world's most widely watched stock market gauge failed to close above that milestone.

The 30-share Dow (up 42.66 to 11,992.68, Charts) did set another record, climbing about 0.4 percent. It was the Dow's eighth record close in the last 11 sessions.

Stocks have been rallying as investors bet that the economy, which is slowing, won't tip into recession, and that corporate earnings will keep growing. Worries about the slowdown in housing have also lessened.

"The economic numbers support the idea of a soft landing," Jay Suskind, a trader at the New Jersey-based brokerage Ryan Beck & Co, said. "Moderation is the word and the market really likes that."

The Dow jumped right at the opening bell and soared as high as 12,049.51, a new trading high, marking the first time it crossed the 12,000 line, after the latest reports on inflation and the housing market reassured investors.

Corporate earnings and another drop in oil prices were also catalysts.

But as in recent weeks, the rally was fairly narrow. The broader S&P 500 (up 1.91 to 1,365.96, Charts) index rose only 0.1 percent while the tech-fueled Nasdaq composite (down 7.80 to 2,337.15, Charts) fell, slipping 0.3 percent.

Oil prices slid below $58. The dollar and Treasury bonds edged higher.

Analysts had said earlier in the week that once the Dow crossed 12,000 there would be lots of selling. But the dip back below wasn't a concern, according to some investors.

"It's been going up in small, non-spectacular steps, which means it's a much healthier market," said Hugh Johnson, chairman of the asset management company Johnson Illington Advisors, referring to the Dow's old record-setting run in January 2000, at the end of the 1990s boom. "We saw big steps in 1999. It's doing just fine."

After the bell, Apple (Charts) reported profits and revenue that trounced Wall Street estimates, sending shares in the computer and iPod maker surging over 5 percent.

eBay (Charts) shares rose in after-hour trade after the online auctioneer reported earnings that beat forecasts.

The earnings parade will continue Thursday as companies representing a broad swath of the economy report before the bell, including Citigroup (Charts), Coca-Cola (Charts) and Pfizer (Charts).

"Some will be stronger, some will be weaker. But the broad mosaic will be attractive to investors," said Jim Awad, Chairman of Awad Asset Management. "The line of least resistance (for the market) is up, at least for now."

The Dow had been flirting with the 12,000 mark since last week, but lost sight of it Tuesday on renewed inflation fears. Those fears dissipated Wednesday.

Before the market opened, the government said that the Consumer Price Index, a key inflation reading, fell an unexpectedly steep 0.5 percent in September but the core CPI, which excludes food and energy prices, rose 0.2 percent, in line with estimates. Analysts had predicted a fall of 0.3 percent for overall CPI.

The relatively tame inflation reading eased concerns from Tuesday after a measure of wholesale prices rose much faster than estimated. That renewed concerns that the Federal Reserve might start raising interest rates again. The central bank has held rates steady at its last two meetings after two years of rate hikes.

A separate government report showed housing strength. The pace of home building unexpectedly strengthened in September as new housing starts rose 5.9 percent. But new building permits fell to a near five-year low.

Earnings news from Dow companies was also mostly good.

J.P. Morgan Chase (down $0.78 to $47.21, Charts), the nation's No. 3 financial services company and a Dow component, continued the trend of strong earnings as it reported better-than-expected results before the bell Wednesday.

After the bell Tuesday, No. 1 chipmaker Intel (up $0.21 to $21.11, Charts) reported lower earnings that nonetheless beat estimates, as the company said it is winning back lost market share. Intel shares rose 1 percent Wednesday.

Computer maker IBM (up $2.87 to $89.82, Charts) also beat forecasts on improved earnings. IBM shares were upgraded by Goldman Sachs to a "buy" recommendation from neutral early Wednesday. IBM shares gained over 3 percent Wednesday.

Internet firm Yahoo (down $1.16 to $22.99, Charts) reported disappointing results and shares fell nearly 5 percent. But Yahoo CEO told investors during a conference call late Tuesday call that its long-awaited new search technology was now live.

Shares of cell phone maker Motorola (down $1.21 to $23.64, Charts) fell nearly 5 percent after the cell phone maker posted disappointing results after the bell Tuesday.

Treasury bonds edged higher, pushing the yield on the 10-year note down to 4.76 percent from 4.77 percent late Tuesday. Bond prices and yields move in opposite directions.

The dollar rose against the yen and euro.

Oil slumped after the government reported a big build in crude stocks. U.S. light crude for November delivery tumbled $1.28 to $57.65 a barrel on the New York Mercantile Exchange.

COMEX November gold lost 90 cents to settle at $592.60.

Market breadth was positive. On the New York Stock Exchange, winners edged out losers on volume of 1.2 billion shares. On the Nasdaq market decliners edged out advancers as 1.8 billion shares changed hands.

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